wndysrf Posted February 18, 2003 Report Share Posted February 18, 2003 Mark?s Market Commentary ? February 17, 2003 Anybody see the most recent Arbitron ratings? Joe Millionaire blew every show out of the water with a 46 share in some markets. Why is that? Because every guy on the planet wants to see the skinny arms, the luscious breasts, the long, slender legs, and shallow personalities of the contestants. And eventually see these goldiggers get their comeuppance. Can you imagine the look on the faces of these high-end bombshells when they discover that their dream man is really a $19,000 construction worker? Living in a $350/mo. apartment? Driving a 1986 Ford F-150? Furniture consists of a mattress on the floor, a 27? television set, and a broken down couch with one leg supported by a stack of old Penthouse magazines and Victoria?s Secret catalogs? One day, the investing public will eventually want the hide of Al Green, the Mutual Fund complex, the Economic Forecasters, Dan ?The Greaseman? Niles, and all the rest for the massive fraud that has been perpetrated. Unfortunately, we won?t see such action until the 2nd half of 2003, when the 3rd ?miracle recovery? fails to show up, and the ?jobless recovery? was really a ?jobless recession?. Saturday Night Live skits will run rampant. Al Green look-a-likes will be featured on Jay Leno. Elaine ?Mama San? Chao will be mocked on Dave Letterman. Can you imagine the look on their faces when Joe Public finally turns on them, after getting royally shafted for 35+ months? But not yet. Al Green is entering the ?Wild Cornered Animal? stage, so he hit the tape with a huge $15 billion Repo Blast for some market propping. Is this any surprise that over 15 major global stock market indices trade blow by blow, toe to toe, and tick by tick with AMAT? Especially Europe. Notice how it flatlined most of the day yesterday when U.S. markets were closed. The market didn?t go anywhere, because the European gamers were frozen when AMAT was not trading. And this morning, it was gyrating wildly, trying to follow the NDX futures before the U.S. market opened. I wonder if the same thing happened in the Panic of 1907. After 35 months, did the stock market still follow the near-bankrupt railroad stocks? In 1932, 35 months after the 1929 crash, was the market still following U.S. Steel? It?s amazing after a massive 78% decline in the SOX since March 2000, Riverboaters remain transfixed on the sector. Riverboater?s Business Daily is now reporting a new indicator called ?Average Chipmaking Weather Index? to measure the health of the Supermodel Equipment industry. It can be found on page A4 of Monday?s issue. The graph is a weekly chart starting in January 2000 and ending February 2003. The index has a ?temperature? range between 120 degrees and -30 degrees to determine whether or not the industry is ?heating up? or ?cooling off?. The index peaked in April 2000 at 100 degrees. One low of 10 degrees was recorded in April 2001 and a deeper low of -10 degrees was reported in October 2001. The index made a recovery back up to 85 degrees in March 2002 (March Madness), and has remained in a tight range between 50 and 70 degrees ever since. The current reading is 65 degrees. I presume that the book to bill number has a lot to do with this index, along with the Semiconductor Equipment and Materials International (SEMI), which constantly bullhorns some announcement about ?14% increase in chip sales this year?, and that the ?industry has bottomed?, etc. And of course that semiconductor cheerleader from TheStreet.com, teamed up with Dan ?The Greaseman? Niles, tell everyone about the AMAT train leaving the station. And lets not forget The Gartner Group, who came out today and forecasted a v-shaped recovery in PC sales. Has anybody seen one sector which has so many Public Relations Agents, Handlers, Promotion Specialists, and Advertisers? I suspect that when this bear market ends, we will see subzero temperatures again, but for now, hope is high and this index has a long way to fall. Unless I am missing some new killer chip application in the works, my guess is that the entire industry is gearing up for another mania chip run, and if it fails to materialize, then you will see an extraordinary bust in the sector as capacity utilization falls off a cliff. No wonder the Supermodels are still trading at 5x sales. As the bear market progresses, we need to look for signs of ?The Point of Recognition? to confirm the 3rd of a 3rd wave down. Last weekend?s Barron?s ?The Trader? column is starting to document the drift in sentiment, but its still very early: ?All trading these days takes place in the context of a broad perception that the market could very well take off to the upside in the event of an Iraq victory, and nobody wants to miss it.? ?Technical patterns have become constant fixations among Wall Street professionals, with plenty of them swooping in to buy when the S & P held a key 820 level and the VIX passed the 40 mark.? ?The market is trading almost as a single instrument lately, a monolithic asset class, swayed by global concerns and traders? emotions in the futures markets.? ?Robin Carpenter of Carpenter Analytix, measures the dispersion level of the market, meaning the degree to which stocks trade independently or with a high degree of sameness. The level on Wednesday was in the lowest 4% of all readings, and the last time this level came in was immediately before the 1998 financial crisis. Being so low in face of recent declines is remarkable, and I believe a sign of continuing weakness.? I wouldn?t be surprised to see the entire HedgeHog industry eventually game the SOX exclusively. One day, we will see huge moves in this sector, with .04 TRINQ readings, as these HeatMappers grow increasingly desperate to catch ?the next big move?. As long as Doc?s FEED Index and MoGauge remain in a bull market, the HedgeHogs will continue to have ample liquidity for gaming. Hypertiger has continually warned us of the faults of a fractional reserve banking system. What about the ?no reserve? banking system? Where Herbie Homeowner?s DiTech refi/cashout mortgage can be securitized, turned into AAA-rated ?cash?, stripped of all currency, rate, and credit default risk, and round-tripped back to the stock market via today?s $15 billion Repo Blast? Or alternatively, round tripped back to Fannie Mae?s balance sheet as a ?money market? liability which in turn can be leveraged again into more mortgage loans, mortgage-backed CMO?s, or some type of derivative exotica? The Chain Letter continues, as long as more and more ?new? borrowers can be found as new ?multipliers? for the Pyramid Scheme. For now, the ?no reserve? banking system will continue to pump in more liquidity into the Keno Pit faster than the redemption stream, which really won?t pick up steam until we reach the ?Point of Recognition?. But as long as we have these spectacular 700 point rallies in 20 trading hours, I doubt that the Mutuals will see any meaningful selling. But gradually, the evidence is building. More from Barron?s: ?Charles Schwab has been aggressively advertising, seizing on the mass disillusionment with Wall Street research by the major firms. Last week, Schwab?s reported average trading volume had fallen 23% in January (from same period last year), and 3% below December, bringing the activity levels back to late 1998 levels.? Schwab?s own research department conducted a study of market timing, and once again determined that ?buy and hold? was the optimum timing strategy. But Barron?s was all over the study, saying that ?this analysis was performed only for the years 1983 through 2002, the greatest bull market of all time. Schwab?s research doesn?t help investors on that score. It just goes to show that the securities industry?s marketing machinery has survived three years of a bear market. The pitch still tends to be biased towards one conclusion, ?Send us your money now.? Page 9 has a full page ad featuring Schwab?s ?Fresh Start Rebalancing Plan? for $95. So, there you have it. A no-reserve banking system creating the greatest liquidity bubble of all time. A Global Speculative Sphere focused exclusively on the highest-beta sector, a sector which has become the market itself. Billions of eyeballs gaming the same technical patterns, nobody daring to miss out on the next big rally. Now, more than ever. Billions clicking buy orders on the Supermodels when the charts say so. Billions selling the same group when the charts say so. Everyone chasing the same horse. And the Matrix Agents are yelling into their bullhorns and loudspeakers, telling everyone to ?rebalance?, buy and hold index funds instead. But nobody listens, because gaming the entire portfolio on margin on a single stock like AMAT is bound to generate returns far in excess of those obtained by the buy and hopers during the greatest bull market of all time. So far, that strategy is working. For the nimble. And we also are seeing more ?lockstep? action in other markets. Notice how the U.S. Dollar and the S & P futures are hopelessly joined at the hip. Since the ?Service Economy? consists of the real estate and mortage business, creating fuel and liquidity for equity speculation by the thousands of funds, who have yet to feel any redemption heat. Which, in a nutshell, basically means the stock market is still the economy. Some might say that gold trades inversely to the U.S. dollar. But I think the gold is a perfect inverse barometer of how many people are entering or leaving The Matrix. If a stampede out of The Matrix ensues, then the stock futures and the U.S. dollar are jammed in the overnights, and anybody attempting to leave The Matrix is Repo Blasted in morning trading and tied down to Dan Niles? Semi Keno Table, guaranteeing a temporary lusting for Supermodel HeatMapping. The insider trading report is out. Angelo Mozillo is now selling big chunks of CFC. Almost $9 million worth on January 29. Yet another AMGN director offloaded an astounding $17 million on January 28. Another interesting one is Occidental Petroleum (OXY), where 4 officers unloaded big chunks in early February. As far as future 144 filings go, 10 more OXY officers have registered. PSFT has 6 guys wanting to unload, and 5 QCOM officers want out. Various boutique investment firms are coming out with some outlandish recommendations on Barron?s research reports section: Hilliard Lyons is recommending MMM as a Long Term Buy with a price target of $160. Blaylock Partners reiterates a Buy rating on EXPE with an $82 price target. Gene Epstein, Barron?s Chief Bubble Economist, agrees with Al Green and says ?consumer finances are not a problem?, claiming that ?the data makes the present look worse than it is?, ?after-tax income will increase?, ?delinquency rates on auto loan and credit cards haven?t risen at all.?, etc. Now for some new announcements: Due to the turmoil and emotion over the weekend regarding ?the bounce?, how far it will go, who predicted it, who didn?t, etc., I have elected to stop making any forecasts or speculations regarding the short term market direction. I think it is best for everyone to follow their own trading strategy. So effective immediately, I will no longer be posting my trades, and will start trading on my own indicators in private, so I will not be adversely influenced by the emotions and the arguments. There are many posters here who are much more experienced and adept at short term trading than I am, and I encourage each of you to follow your favorite poster, whether it be Doc, Simple Guy, Brian4, Piledriver, or whoever. Also, I must warn everyone that my Mark To Market commentary is likely to be shorter in the future. Like Doug Noland, I feel like I?m a broken record, repeating the same themes over and over, and I?m sure its getting tiring. It is difficult to think of new material, given that the market seems to behaving in the same repeated pattern over and over. Options Racketeering, Month End Tape Jamming, Repo Blasting, Technical Breakdowns becoming ?fixed? overnight, and on and on. What has really changed? Nothing. You guys were pretty tough on Buddha over the weekend. He has successfully called these OE Spikes for months in a row now. He disappeared into the Tai Chi den. Don?t know when he will return. Over 21,000 views and 450 posts over the long weekend. A new record, even for a 3-day weekend. Thanks, everybody?. Link to comment Share on other sites More sharing options...
Slothrop Posted February 18, 2003 Report Share Posted February 18, 2003 How about one long piece per week -- say, on Friday or Monday -- and short, but incisive posts on other days? Link to comment Share on other sites More sharing options...
mksloth Posted February 18, 2003 Report Share Posted February 18, 2003 Mark, don't know about the others. But for me, your daily posts are absolutely required reading. As a newbie trader, I get a lot of knowledge from both the tirade as well as your portfolio selections. Please don't take them away. As for the bashing, I understand that it's easy to say "ignore it". Please try... Link to comment Share on other sites More sharing options...
Guest Posted February 18, 2003 Report Share Posted February 18, 2003 Great post again, Mark. But as an agency media director, I have to pick a nit. Arbitron measures radio audiences. Nielsen measures TV. There, I feel better. Link to comment Share on other sites More sharing options...
MrHanky Posted February 18, 2003 Report Share Posted February 18, 2003 well,I said the other day if we gap above the 13 dma,we would see the 50 dma real quick. we just closed .25% under the 50 dma on the nascrap either we pull back and retest support,or we gap right to the 200 dma.the last 2 major rallies all went above the 200 dma before failing. gave back most of my gains in just 2 days on my shorts but the position is not huge.luckily I unloaded all puts the other day.sold qavoz mar 26 qqq put @2.60,bid is now 1.55 3 days later.now I'm looking for an exustion gap to reload puts. Link to comment Share on other sites More sharing options...
soup Posted February 18, 2003 Report Share Posted February 18, 2003 I always Undertrade, so I will be able to fight tommorrows battle. But in 20+ , years watching both the bond and stock mkts I have not come close to witnessing what is presently going on. I will not repeat all the insane situations, as Mark as done so very well. THis is jut incredible. I was around during the great bond bear market, 14% yld on the bond, those days were days of capitulation, of fear and loathing. Most folks would not touch the long bond with a 10 foot pole, as it was surely going to 20%; the institutional crowd all had durations well shorter than the mkts, everyone packed in 2 year ust. All the signs that a great new bull mkt was about to begin were present. Compare and contrast that to todays mentality regarding equities. I grant you not many are throwin new money in, but has anybody sold? Will anyone admit they were wrong? Will anyone take a loss? Link to comment Share on other sites More sharing options...
soup Posted February 18, 2003 Report Share Posted February 18, 2003 What will it take to get the capitulation? How long can they continue to push on a string? Where is the outrage? WHere are the demonstrations outside Fido's H.Q's? Link to comment Share on other sites More sharing options...
machinehead Posted February 18, 2003 Report Share Posted February 18, 2003 "The stock market is STILL the economy." If this whole game is based on confidence -- and it seems to be -- then Keynesian economics is due for an update. The Keynesians engaged in deficit spending to pump money into the real economy. Well, the real economy doesn't matter anymore. Manufacturing is what, one-sixth of the economy? Waste of time ... It's dawning on the neo-Keynesians that perception is everything -- the sizzle IS the substance. If the stock market IS the economy, then economic recovery requires raising the stock market, pure and simple. Capital spending is irrelevant. Consumer spending is irrelevant. Tax cuts are irrelevant. Dow 10,000 is the mesmerizer, the mass hypnotizer, which will goad the mass psychology back into recovery mode. How long will it be before Ben Bernanke announces a credible promise that the Federal Reserve will buy stock futures, and keep on buying them for as long as it takes? Or is the program already underway, unannounced? Link to comment Share on other sites More sharing options...
soup Posted February 18, 2003 Report Share Posted February 18, 2003 absolute insanity that the funds are all piling into ebay and amgn, the two stalwarts of the next great bull. Piling into this crap is the same action that took place with intc, softie, and crisco right before they all cracked, same as nvda and sebl, right before they crapped out. Same as it ever was, the big funds all holding the same 2 or 3 stocks, overloved overowned and overvalued. Yet they still have money inder management? Like I questioned before, with no new inflows where is their buying power emanating? Only thing I can ascertain is they are further drawing down their credit lines, or they are getting direct injections from uncle albert. Could be wrong, of course, but the contrain play here is bearish. The crowd is still overwhelming playing the long side, and the only fear continues to be fear of being out of the mkt. I know this is broken record, but when will this change? Link to comment Share on other sites More sharing options...
phatbubble Posted February 18, 2003 Report Share Posted February 18, 2003 mark: 1) you're not a broken record 2) i'll really miss your short term directional calls, they're helpful and very much appreciated. *** posted this on IDS: on a hoods n bosses note, i went back through the last 9 scam weeks to look at a few things. here's what i found. summation of daily SPX closes: M +54 T +31 W -38 TH +9 F -1 weeks in which the largest up day was M or T: 6 of 9. weeks in which W closed in a different direction than M: 7 of 9. weeks in which the initial direction (M or M-T) had reversed, on a closing basis, by T or W: all of them (9 of 9). here's hoping tomorrow's wednesday....IYKWIM. Link to comment Share on other sites More sharing options...
soup Posted February 18, 2003 Report Share Posted February 18, 2003 machine: now doubt that porgram is well inderway, the only question is how long till it fails miserably? As all statist interventions ultimately are disasters Link to comment Share on other sites More sharing options...
ArdentGuy Posted February 18, 2003 Report Share Posted February 18, 2003 .... So effective immediately, I will no longer be posting my trades, and will start trading on my own indicators in private..." NO! . . . Please don't cut us off! I (for one) find it extremely interesting to see how you trade on your expertise. Many times I have followed on your coat-tails. And now you want to cut us off?!? Please, NO! This is a dangerous trend that could result in everyone trading in private. Please, please, please reconsider privatizing your portfolio. Link to comment Share on other sites More sharing options...
soup Posted February 18, 2003 Report Share Posted February 18, 2003 BTW: why is keynesian dogma even discussed anymore? Have we learned Nothing? Oh well , like they say every new generation has to make the formers mistakes. Link to comment Share on other sites More sharing options...
microdon Posted February 18, 2003 Report Share Posted February 18, 2003 Ord on O'Brien show did not like volume drying up on S&P. He and O'Brien see 868-70 as possible max. O'Brien was thinking 3 gaps to a top going on with NASDAQ. He was thinking COMP might get to 1449, Ord not quite that confident. But he is the one who is long. If another gap tomorrow and volume drops off, then we have exhaustion gap, and then maybe SG's tidal wave may start. Both constructive on gold short term. XAU got to confluence on light volume; Ord expects an attempt up. Expects the 340 area to hold. Trade how you think, but Ord is hot as of late. As per usual, trade safe. Link to comment Share on other sites More sharing options...
bubbadropping Posted February 18, 2003 Report Share Posted February 18, 2003 Windy, excellent takes as usual. Very funny on the Joe Millionaire take. The crash pad with the Penthouse Couch leg brings back old memories. I sympathize with the rest. I am no doubt going to be making fewer appearances myself. I may have overstayed my welcome and I apologise to those who I insulted with my cartoon political takes over the weekend. I probably will be spending much less time trading anyway and positioning further out. My short term trades will be Forensic based in nature as these seem to have the best trend. I still contend we see a reversal of all this hysterical momentum on or by Thursday. I wish that there were a sub site here devoted purely to forensic criminal diagnosis of stock operation. It could be fun and colorful and yield good returns twice each month off EOM and OE plays.If you can't beat em you gotta join em. It should not ever be underestimated imo. anyway best to all, and thanks Marky for all the fun and the perspective . buddha Link to comment Share on other sites More sharing options...
Recommended Posts
Archived
This topic is now archived and is closed to further replies.